facts:
At March 31, 2020, Rustic Company's records show the following information.
Unadjusted Cash balance per bank records: $22,912
Unadjusted Cash balance per book records: $28,530
Deposits in transit (Outstanding deposits): $17,000
Checks in transit (Outstanding checks): $11,752
Rustic Company's March 2020 bank statement contains the following information:
Safety Deposit Box Fee: $25
Bank Service Charge: $30
Interest Earned: $45
In reviewing Rustic Company's information, you discover that Rustic Company incorrectly recorded Check #1031 in its cash payments journal (a log of outgoing checks). Although Rustic Company correctly prepared check $1031 as $400, the company incorrectly recorded the $400 check as $40 in its cash payments journal.
Initial Comments
Use the information presented above to answer the following questions. Post your initial comments by 11:59 P.M. on Monday, April 20. You will not be able to view your classmates' postings until you post your initial comments.
1. What is the adjusted cash balance per book records? Show your calculation.
2. What is the adjusted cash balance per bank records? Show your calculation.
Solution 1 & 2:
Rustic Company | |||
Bank Reconciliation - March 31 | |||
Bank's Cash balance | Company's cash balance | ||
Particulars | Amount | Particulars | Amount |
Ending balance as per Bank Statements | $22,912.00 | Ending Balance as per cash books | $28,530.00 |
Additions: | Additions: | ||
Outstanding Deposits | $17,000.00 | Interest earned | $45.00 |
Deductions: | Deductions: | ||
Outstanding Checks | $11,752.00 | Bank Service charge | $30.00 |
Safety deposit box fee | $25.00 | ||
Incorrec recording of check 1031 | $360.00 | ||
Up to date cash balance as per bank | $28,160.00 | Up to date cash balance as per books | $28,160.00 |
adjusted cash balance per book records = $28,160
adjusted cash balance per bank records = $28,160
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